The IRS Is Extending Its Influence Abroad

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In Heritage Work

The Foreign Account Tax Compliance Act goes into effect next month. FATCA was passed in 2010 to crack down on tax evasion, but Heritage Foundation experts Anthony Kim and Curtis Dubay report that the law actually hurts Americans living and working abroad.

“Like another ill-considered piece of legislation enacted that same year (Obamacare),” they explain, “FATCA granted the IRS a new level of intrusiveness into the lives of Americans.”

Instead of growing government, Kim and Dubay recommend a broad tax reform, which would “help curtail tax evasion in a more effective way without resorting to onerous and intrusive regulations such as FATCA.”

What do you think? Should the IRS be able to extend its reach this way?

5 Ways Tax Reform Would Help You and Every American

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In Heritage Work

Heritage Foundation expert Curtis Dubay explains how a principled, conservative tax reform would help you:

  1. Your annual income would grow
  2. Taxes would be simpler to file
  3. The tax code would be fairer
  4. Government’s role in the economy would be smaller
  5. The IRS would have less power

Heritage’s Saving the American Dream plan outlines solutions on taxes, spending, and other issues.

Do you think Congress will act on tax reform this year?

The Real Reason Congress Is Bullying Apple: They Want Apple to Pay More Taxes

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In Heritage Work

Apple executives were called in to testify before members of Congress yesterday. They were accused of “shifting” profits abroad to avoid paying taxes.

The fact of the matter, though, as Heritage Foundation tax expert Curtis Dubay told Fox Business yesterday, is that the money hasn’t been shifted at all because it wasn’t earned in the U.S. “I can’t go down to the Apple store here in Washington, buy an iPad, and have Apple then ‘shift’ that income abroad,” he said.

The U.S. corporate tax rate is the highest rate in the world. As long as it remains so exorbitant, successful businesses like Apple are going to keep their foreign income abroad.

Heritage’s Amy Payne has more:

The reason the Senate feigned indignation over an issue that had nothing to do with the U.S. is that some Members want Apple to pay more U.S. tax on all that foreign cash. They want Apple to bring all of that profit back into the U.S. and pay the U.S. corporate tax rate—the world’s highest—on it. But as long as we keep the U.S. rate the highest in the world, Apple and other multinational businesses are going to keep their foreign income abroad.

Apple has not done anything illegal by minimizing its tax liability. Because of America’s extremely high corporate tax rate, many companies don’t return to the U.S. what money they earn abroad. While other countries have been making efforts to cut their corporate tax rates, the U.S. has been making it more and more difficult for U.S. businesses.

Do you think Apple should pay more in taxes? Or should we fix the tax code to stop punishing successful firms?

No, We Don’t Need More Taxes

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In Heritage Work

As they debate how to resolve the federal deficit, lawmakers need to avoid any additional tax increases, Heritage Foundation scholar Curtis Dubay argues.

“There will be plenty of revenue coming into Washington over the next 10 years,” Dubay explains. “Additional tax hikes would not address the problem of excessive spending but instead give more money to Congress and President Obama to spend.”

And tax increases would slow economic growth and limit opportunity: Continue Reading »

Answers to Six of Your Questions About the Tax-Hike Deal

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In Heritage Work

Photo: Flickr/KP Tripathi

Late Tuesday night, the House of Representatives approved the Senate’s last-minute fiscal cliff” deal that raises taxes on most American workers. Here are some answers to important questions you may have about what lawmakers actually agreed to.

What does it boil down to? The law includes $10 in tax increases for every $1 in spending cuts. Ultimately, this bill actually increases government spending by $330 billion.

Will normal Americans like me be affected?  Continue Reading »

Heritage’s Top 10 Policy Reports of the Year

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In Heritage Impact & Heritage Work

Year after year The Heritage Foundation continues to make an impact in the fight for conservative principles. This year, Heritage’s expert policy analysts testified before Congress 34 times and distributed more than 1,100 policy reports on Capitol Hill. Below is the list of the top 10 most read research papers of the year: Continue Reading »

Heritage’s Domestic Policy Experts Respond to Last Night’s Debate

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In Heritage Work

Last night, Heritage Foundation experts live-blogged their analysis of the issues raised as President Obama and Gov. Mitt Romney debated. Heritage’s Amy Payne rounds up our what our experts were saying.

Tax expert Curtis Dubay on the need for tax reform:

Obama repeated the falsehood that Romney’s plan would raise taxes on the middle class. This incorrect assertion was spread by a biased report from the Tax Policy Center. Romney’s plan can make pro-growth changes to the tax code and doesn’t have to raise taxes on the middle class.

Read our experts’ takedown of the Tax Policy Center’s flawed report. Continue Reading »

Erroneous Report on Romney’s Tax Plan Harms the National Debate on Tax Reform

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In Heritage Work

Tax calculator

Poor analysis in a recent Tax Policy Center report on Gov. Mitt Romney’s tax proposal is harming the debate on tax reform.

The report erroneously claims that Romney’s plan would “provide large tax cuts to high-income households, and increase the tax burdens on middle-and/or lower-income taxpayers.”

The authors of the report neglected to take all information into account, Heritage Foundation tax expert Curtis Dubay explains, and selected only the information that best supported their unfounded hypothesis: Continue Reading »

5 Reasons Why Taxmageddon Is a Terrible Idea

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In Heritage Work

When Taxmageddon hits on January 1, 2013, the financial devastation will be immense. Heritage Foundation experts strongly oppose the liberal plan to allow such massive tax hikes during this tough economy.

Taxmageddon will affect all Americans. Here are five consequences we can expect on January 1: Continue Reading »

The Truth About How the Clinton Tax Hikes Really Affected the Economy

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In Heritage Work

CashFormer President Bill Clinton is highlighting today’s speakers at the Democratic National Convention in Charlotte. Liberals often attribute the strong American economy during the 1990s to Clinton’s tax hikes. But this just isn’t historically accurate.

Heritage Foundation tax expert Curtis Dubay explains:

The economic defense of the Clinton tax hikes does not hold up against the historical facts. The economy did exhibit economic growth during the 1990s, but it was well below potential. Moreover, rapid growth did not occur soon after the tax hike—it came much later in the decade, when Congress cut taxes. After the 1993 tax hike, the economy actually slowed to a point below what one would expect, considering the once-in-a-generation favorable economic climate that existed at the time. Continue Reading »

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